NATIONAL LABOR UNION v.

CIR
G.R. No. L-31276 / 116 SCRA 417
September 9, 1982

FACTS:

The Acting Prosecutor of this Court filed a formal complaint with this Court
charging respondent Everlasting Manufacturing of unfair labor practice within the
meaning of Section 4(a), sub-paragraphs 1, 4 and 6 in relation to Sections 13, 14 and
15 of Republic Act 875 (An Act to Promote Industrial Peace and for other Purposes,
repealed by P.D. 442). A Collective bargaining agreement by and between complainant
union and respondent Everlasting Manufacturing, a business establishment which
manufactured paper cups, water cups, and other allied products, through its general
manager Benito Estanislao Alias Cha Wa began hiring 24 new workers. It was alleged
in the complaint that in order to avoid the implementation of the collective bargaining
contract, to bust complainant union, to discourage membership with complainant union,
on the pretext of selling and closing its business, and without any justifiable reason
respondent company, by its general manager Benito Estanislao and proprietor Ang Wo
Long, dismissed and/or locked out all the members of complainant union.

Continuously thereafter, respondent company continued with its business operations by

availing of the services of the above-mentioned 24 new workers who are non-union
members, using the same premises, business name, machineries, tool and implements,
same officials and supervisors, including its assistant manager Tan Hoc; That
notwithstanding representations made by complaint union for and in behalf of its
members, respondent failed and refused and continues to fail and refuse to reinstate
them to their jobs. That since their mass dismissals and/or lock out, the dismissed
employees has not found any substantial and/or equivalent employment for themselves,
in spite of diligent efforts to that effect. Respondent court through Associate Judge
Amando C. Bugayong: rendered a decision finding respondent guilty of unfair labor
practice.

ISSUE:

Whether or not the respondent court was justified in completely over-turning its
March 22, 1966 ruling on the liability of Ang Wo Long (finding guilty of unfair labor
practice) under the May 3, 1963 collective bargaining contract.

RULING: 1. No, the respondent court was not justified in completely over-turning the
said ruling because the respondent court modified its decision and absolved Ang Wo Long of
responsibility for and liability under the May 3, 1963 collective bargaining contract because of its
finding that there was a lack of evidence which would show knowledge not only of the CBA but
of the existence of the union itself on the part of Mr. Ang Wo Long.

Knowledge or awareness of what is going on refers to a mental and inner state of

consciousness, cognizance, and information. Whether or not Mr. Ang Wo Long knew
the labor problems of the firm he purchased, the existence of a union, the on-going —
CBA negotiations, and the efforts of the employees he later dismissed to reach an
agreement with management on the terms and conditions of their employment can be
determined only from an admission of Mr. Ang himself or from the surrounding facts and
circumstances indicative of knowledge. or awareness.

Under the facts are circumstances of this case, it is irrational if not specious to assume
that Mr. Ang bought a business lock, stock, and barrel without inquiring into its labor-
management situation and that his dismissal of all the union members without retaining
a few experienced workers and their replacement with a completely new set of
employees who were strangers to the company was anything other than an attempt to
rid the firm of unwanted union activity.

There is substantial evidence to sustain a finding of Mr. Ang's knowledge of the

bargaining negotiations and the resulting CBA and, consequently, of unfair labor
practice on his part.

The former owner, Benito Estanislao alias Cha Wa, sold Everlasting Manufacturing to
Ang Wo Long on April 29, 1963 while CBA negotiations were going on and about to be
concluded. The firm had a recent history of labor problems and the bargaining
negotiations came about only after a strike.

According to the respondent court, the acts of Ang Wo Long — his filing an application
for registration with the Bureau of Commerce on April 21, 1963, his securing the
mayor's permit, and his other acts of management — were only acts preparatory to
taking over the firm and not acts indicating knowledge of union activity and the CBA
negotiations. We rule otherwise. Precisely because Mr. Ang performed acts indicative of
normal care and caution on the part of a man buying a manufacturing firm, We rule that
the same care and caution was also extended to a more sensitive aspect of the
business, one attracting the greatest degree of concern and attention of any new owner,
which was the relationship of the workers to management, their willingness to cooperate
with the owner, and their productivity arising from harmonious relations. Benito
Estanislao signed the CBA no longer as owner but as "general manager." The new
owner used the same premises, the same business name, machineries, tools and
implements and the same officials and supervisors including the assistant manager, Mr.
Tan Hoc The only change was the replacement of the 21 union member with a
completely new set of employees hired from outside the firm. As stated by Judge
Amando C. Bugayong in the court's March 22,1966 decision, the respondent Ang Wo
Long did not show any just cause for dispensing with the services of all the 21 union
members. We agree with Judge Bugayong that "the conclusion becomes inescapable
that he (Mr. Ang) dismissed the complainants in order to break the union and do away
with the existing collective bargaining agreement which it has obtained only after a
strike and bargaining negotiations."

Another mystifying aspect of the questioned order and resolution was the placing of full
responsibility on the shoulders of Mr. Benito Estanislao whom the court funny knew had
already conveniently disappeared even as it absolved the only person who could grant
affirmative relief and whose liability had earlier been determined to be founded on
substantial evidence. The summons issued to Benito Estanislao was returned by Ang
Wo Long's counsel who stated that Benito Estanislao was no longer at his former
address. Summons had to be effected through publication. The person found guilty of
unfair labor practice did not show up at the reopened hearings and as far as the records
before US show, had disappeared. The concatenation of circumstances clearly
indicates the participation of both Mr. Estanislao and Mr. Ang in the unfair labor
practice. Hence, Ang Wo Long should be jointly and severally liable with Benito S.
Estanislao for the payment of backwages to the complaining employees.

Hence, the Court held that they grant three (3) years backwages without deduction or
qualification to the dismissed employees. Following the same considerations and in
fairness to Ang Wo Long, reinstatement of the complaining employees should be made
on the basis of the latter's physical fitness for the respective jobs from which they were
illegally ousted.

DISPOSITIVE: WHEREFORE, the petition is hereby GRANTED.

1) Ang Wo Long and Benito S. Estanislao are hereby ORDERED jointly and severally to
pay the complaining employees three (3) years backwages without deduction or
qualification.

2) Ang Wo Long is hereby ordered to reinstate the complaining employees and he may
require certifications of their physical fitness by a government physician; and

3) Ang Wo Long and Benito S. Estanislao shall pay the costs.

DOCTRINE: Appreciation of facts and conclusions drawn from facts must be such as
would be acceptable to a reasonable mind. The reconsidered conclusions of the
respondent court not only fly against the dictates of reason and common sense but are
out of touch with the grounds of public policy implicit in the Industrial Peace Act and in
the constitutional mandate on protection to labor.

Knowledge or awareness of what is going on refers to a mental and inner state of

consciousness, cognizance, and information.